EU seeks dual talks on US surveillance, free trade deal

European Union countries agreed Wednesday that free-trade talks with the United States should take place in conjunction with discussions about US spying allegations, after France raised concerns over the issue on Wednesday.

European countries agreed Wednesday that talks on a free-trade deal with the United States should start in parallel with discussions about NSA surveillance – addressing concerns raised by France.

French President Francois Hollande insisted after meeting German Chancellor Angela Merkel and other European leaders in Berlin that the trade talks can start only “at the same time, at the same date” as talks with the U.S. on concerns over its intelligence activities.

That raises questions as to whether the launch of the trade talks will go ahead as originally scheduled early next week. France had called earlier Wednesday for a two-week delay.

The head of the European Union’s executive Commission, which will lead the trade talks, said U.S. Attorney General Eric Holder had offered to set up “as soon as possible” U.S.-European working groups on intelligence issues.

“We are committed of course to the Trans-Atlantic Trade and Investment Partnership,” Jose Manuel Barroso said. “But we expect that in parallel ... we analyze the oversight of intelligence activities, intelligence collection and also the question of privacy and data protection.”

For the trade talks “to be a success, we need confidence among partners and confidence can become better” if Europe’s concerns are addressed, Barroso told reporters.

Merkel, whose country has Europe’s biggest economy, said leaders at a meeting focusing mainly on youth unemployment were “very concerned” about reports of the U.S. eavesdropping on its European allies, and said the U.S. offer to set up working groups on the issue quickly was “very important.”

“Time is pressing,” she said, adding that it was the “right idea” to say those groups should start work parallel to the beginning of the trade talks, whose opening will follow months of protracted and painful efforts to find a common European stance.

Reports last weekend that the U.S. National Security Agency bugged EU diplomatic offices in Washington and infiltrated its computer network angered European officials, who noted that mutual trust is needed in talks on such a huge trade deal. The deal is expected to boost economies on both sides of the Atlantic by removing tariffs and other barriers to trade.

French Foreign Minister Laurent Fabius acknowledged to parliament Wednesday that the free trade deal is “very important for the United States and very important for Europe.” But, he added that the two sides needed negotiations “in a climate of trust.”

Hollande and his government are trying to appear tough internationally since his leadership is under pressure at home, not only from the opposition conservatives but increasingly from the far-left wing of his Socialist party. Hollande may be hoping that it’s good for him and his popularity to show that he can be strong against the free-market United States.

In Berlin, Merkel spokesman Steffen Seibert said before the leaders met that Germany supported efforts to begin the trade negotiations as planned July 8.

But Volker Treier, a senior official at the influential German trade association DIHK, told the Berlin daily Tagesspiegel that he was concerned about the atmosphere.

“For a free trade agreement there needs to be transparency and trust between the potential partners. The talks will get harder, the greater the distrust is,” he told the newspaper in comments reported Wednesday. “If the United States knew in advance what our negotiating strategy was then we Europeans would be fleeced.”

Last month, the European Commission was given the mandate from all members to start the talks after striking a deal with France about keeping the movie and television business out of the negotiations to shield Europe’s audiovisual industry from Hollywood.

A free trade pact would create a market with common standards and regulations across countries that together account for nearly half the global economy.

A recent EU-commissioned study showed that a trade pact could boost the EU’s output by 119 billion euro ($159 billion) a year and the U.S. economy by 95 billion euros ($127 billion). For Europe in particular, that extra growth could be crucial to help pay high public debt and bring down unemployment, which is at record highs.